National Association of Home Builders Discusses Economics and Housing Policy

Eye on the Economy: Labor Market Gains are a Positive Sign for Housing

An improving labor market will help support growth in home building in 2015. And the November report offered the most positive jobs data in some time. According to the Bureau of Labor Statistics, 321,000 jobs (seasonally adjusted) were added to the economy in November, and the numbers for September and October were revised up by a combined 44,000. Prior to November, the average monthly gain in jobs for 2014 had been 233,000. The BLS data also indicated that the average workweek and hourly earnings improved.

Home builders and remodelers added 16,700 jobs to the economy in November, according to the BLS data. Over the last year, residential construction employment has grown by 122,000.

Another industry headwind has been access to capital. While access to AD&C loans remains an issue, there are signs of gradual improvement. A quarterly NAHB survey on construction lending indicated easing lending conditions during the third quarter. These results mirror a broader Federal Reserve survey showing an improved lending environment for commercial real estate generally.